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How to Reduce Accidents and Insurance Claims For Transport and Logistics Operators

Laurence Jones Director Global Risk Assessment – TT Club

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Overview

• Analysis of the main causes of claims • Includes 6 years statistics • Over 2000 claims • Analysis of all claims over US$ 10,000 • Includes all types of claims

• Bodily injury • Other liability • Property

• Loss prevention actions to reduce these claims

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Global Claims Analysis

Weather4%

Maintenance33%

Operational63%

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Operational Claims

Truck/ Vehicle

10%

Lift Truck5%

Cargo Issue4%

Theft29%

Systems & Processes

45%

(Other)7%

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Systems and Processes

(Other)4%

Uncollected cargo

5%

Release - no B/L12%

Bad stowage / handling

21%

Customs17%

Contractual13%

Clerical error14%

Reefer14%

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Bad Stowage & Handling

What you can do: • Staff training / monitoring • Quick risk prediction for abnormal loads • Use the correct equipment for handling • Develop best practice guidelines for stowage / handling • Declare correct weight • Stuff container evenly & securely • Do not eccentrically load containers • Ensure dangerous cargo is correctly declared • Refer to the ILO best practice guidelines

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Bad Stowage & Handling

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Customs

Issues: • Mis-declaration of cargo • Ensuring T1 documents are closed • Lack of or late paperwork • Clerical errors in completion of paperwork • Drug or immigrant discovery

Results: • Costly delays • Costly fines

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Reefers

Issues:

• Procedural issues • Setting of the correct temperature • Incorrect information flow • Monitoring • Audit trail (Data Logger) • Offer clear instructions • Verify the condition of the reefer unit prior to loading • Compatibility of cargo

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Contractual Issues

• Incorporation of Standard Terms & Conditions

• By signature • By notice • By reference

• Ensure back to back liability with sub contractors • Contract awareness – Full value clauses • Fully understand the potential exposures presented • Incorporation of industry conditions / International conventions

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Theft

(Other)6%

Theft in transit - contractor

54%

Theft from own premises

13%

Stocktaking loss7%

Theft in transit - own

transport8%

Theft from contractor's

premises12%

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Contractors issues:

54% of theft costs occur in transit using contractors 12% due to theft from contractor’s premises

To prevent theft you must know your contractors:

• Pre-employment checks / references • Number of years established • Company registration number • Country the entity is registered • Direct contact details • Any affiliations with Industry Trade Bodies • Contractors’ Standard Terms and Conditions • Avoid using internet clearing sites

Theft

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Transit issues:

62% of theft costs occur in transit

To prevent you should: • Send trucks in convoy • Only stop at approved truck stops • Do not leave truck unattended • Alter routes for regular deliveries • Only use approved transport contractors • Use tracking devices • Share bad experiences • Effective use of available technology

Theft

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13% of theft costs occur from own premises

To prevent you must have: • a physically secure site – good fences • systems and procedures to deter and detect:

• security guards • CCTV monitoring • automated gate control system • checks and double checks on paperwork

• Remember - most thefts are inside jobs

Refer to TT Club Supply Chain Security booklet • Available at www.ttclub.com

Theft

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Fires

Building47%

Cargo on vessel

19%

(Other)20%

Cargo on land14%

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Building Fires

47% of claims costs due to building fires $31.8m in last 6 years • Most due to electrical faults

Prevention actions: • Fire risk assessments • Correctly identify and declare dangerous goods • Install fire detection and suppression systems • Regular tests and inspections of fire fighting equipment

(including sprinkler systems) • Regular statutory inspections of electrical installations • Effective use of available preventative technologies

• Thermographic surveys of switchboards • No smoking policy • Good housekeeping

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Cargo Fires

33% of fire costs caused by mis-declared cargo. What can you do to help prevent: • Correctly declare dangerous goods • Cargo compatibility • Safe – minimum stowage separation • Flash or ignition point • Training and education / qualified personnel • Legislative (IMDG) awareness

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Summary

• Is it worth the cost and time to do things safely and correctly? • Definitely YES

• Produces • Injury reductions • Cost savings • Increase in efficiency • Productivity increase • More efficient deployment of employees • Improved customer relations • Reduced insurance claims and premiums

• All of which can be achieved through………

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Loss Prevention Focus

Training:

• Continuous safety awareness • Container stuffing and securing • Mandatory dangerous goods training for all shore side staff

Procedures:

• Building fire prevention • Theft prevention

• Contractor management • Site security

• Systems & processes procedures • Cargo stowage and handling • Customs • Contractual issues

Re-design/Technology:

• Container weight & eccentricity measurement • GPS Tracking devices / security control

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Do not be complacent about safety Plan ahead and be prepared

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Thank You Laurence Jones

Director Global Risk Assessment - TT Club laurence.jones@thomasmiller.com

www.ttclub.com

Specialist insurance products and services packaged for the international transport and logistics industry